Tag: Thought Leadership

With Makayla Everett, SimplyBiz

 

As a continuation of Uinsure’s ‘How the pro’s do it’ campaign, Makayla Everitt, Head of SimplyBiz Mortgages discusses the insurance opportunity that lies within the Buy-to-Let market with her top 10 tips… Don’t forget the tenant!

Tenants could hold the key

With many struggling to get a foot on the property ladder, the demand for rental properties has soared over recent years.

The stigma around owning your own home has changed as more people see long-term rental solutions more financially viable than getting a place of their own. Bearing this in mind, tenants are no different to homeowners in the respect that should something happen to their home, their most cherished possessions are covered. Not only that, but should the property become uninhabitable to any reasons, tenant insurance would find them a place to stay whilst the repairs are made.

Commonly, many tenants believe it is the landlord’s responsibility to arrange contents insurance, where of course, it isn’t. There is also a real risk that many tenants maybe unaware and in breach of tenancy agreements of their contract stipulates contents insurance is required.

Raising awareness in their area is essential. By partnering with local letting agents, you would be able to promote this issue whilst also opening to a new, under-serviced area of the market, with potential to re-engage with these clients further down the line if they do require potential mortgage and protection advice.

You can make a real difference

1. Don’t forget tenants want to protect their income and families too. Offer them a review to ensure they are kept secure.
2. Don’t forget that Landlords also need protection and there are a number of landlord focused products available to support across a number of areas.
3. Don’t have the time? Referring Landlord Insurances, LPS and Rent Guarantee offers security and will open the door to new future clients.
4. Win, win – offer an enhanced letting agreement for better protected tenants.
5. You can support your landlords in getting back to auctions and undertaking refurbishment with Bridge-to-Let products.
6. Clients of tomorrow – don’t underestimate the value of Contents Only policies.
7. Create loyalty with existing landlords, use the agent’s knowledge to guide where they buy. This will create an instant let, the landlord is then happy to give the agent yet another property.
8. Tenants giving notice are potentially your purchasers of today. Referrals from the letting agent can benefit all concerned.
9. Free marketing literature to support referral business is available from most insurance providers.
10. Increase your brand awareness, board presence and overall business growth by developing string relationships with agents in your area.

Let’s not forget landlords

With rental property demand the highest it has been in decades, and more clients entering the Buy-to-Let space- have you considered targeting portfolio and landlord clients in your area?

Following the turbulent year that was 2020, the mantra ‘expect the unexpected’ never rang truer. Landlords and letting agents place great value on loyal and dependable tenants who provide regular income. Landlord insurance is a viable solution to all landlords ensuring that if the property is damaged, uninhabitable or lays vacant for an extended period that the property is repaired, and the landlord is not left out of pocket.

You can offer to work in association with your local letting agents in a mutually beneficent manner, you work can provide them, and you, with an income, it can safeguard the owner of the property against having to find another tenant, thus running the risk of a loss of income and, perhaps most importantly, it will also provide safety and security for the renting party. Quite literally, and like every fairground across the UK, everyone’s a winner.

So, hopefully you are now thinking which letting agents you have in your area, and who will benefit from your experience, knowledge, and professionalism. Please remember a lot of these business leads can be referred, ensuring you receive maximum income for minimum time spent.

 

Simple products and services stand out. It has become a necessity worth striving to achieve in a complex market and within busy mortgage firms across the UK.

Creating Simplicity

So how do you go about achieving simplicity in your business? Simplicity is all about finding the right balance of what is necessary and what is not.

In the past, many advisers preferred to structure their sales process across several face-to-face client appointments. The pandemic forced a move to online meetings, which resulted in much improved efficiencies for both advisers and customers alike with many firms choosing to continue this approach post lockdown. This even led to wider benefits such as being able to return mortgage recommendations within a few hours of the call because of the time savings generated.

This is a great illustration of how simplicity has been created on such a wide scale, despite it being forced on us by a global pandemic. And, importantly, it makes the advisory community stand out.

Hiding complexity to create simplicity

Once you cut through everything in your business that isn’t necessary, the next stage is to look at what is necessary but repetitive.

This is where good technology solutions come into play, effectively hiding the complexity of most repetitive actions (that’s what it’s really good at), so the users only see simplicity.

As an example, Uinsure knew that asking lots of questions to apply for insurance was complex, boring, arduous and sometimes ambiguous. So instead, we decided to shed all the complexity of traditional providers, by only asking the critical questions and sourced the rest of the data from other places. This was a meaningful innovation because it simplified the experience of accessing insurance and hid the complexity to the end user.

In a world full of complexity, it is simplicity that makes a product or a service stand out. It’s therefore crucial that we understand how to balance complexity with simplicity and can implement this understanding in our businesses.

The reality of today’s landscape is your customer is overwhelmed with choice. Brand loyalty is lower than ever and switching to competitors is getting easier and easier – Facebook recently learned this the hard way after it showed negative user growth for the first time ever and lost $250bn dollars of value in the process.

Customer experience (CX) is the most important thing any organisation needs to be obsessing about to compete, grow and even survive. Everything from systems and communications to processes and proposition needs to be created with CX technology at the very heart of the business.

For most of us, we can’t build an entire ecosystem ourselves so choosing the right partners who can integrate seamlessly enabling the CX you want to create for your business is mission critical.

When assessing the market for partners you’ll find two kinds of businesses, on the one hand are those that are largely product siloed and use technology to automate traditional processes. These firms will essentially take the same arduous paper processes customers used to fulfil and digitise them without any thought as to how they will intertwine into the CX you’re developing to accelerate your business.

This is then often supported by sub-standard API integrations making your CX slow, fragmented and clunky – a recipe to send your clients elsewhere.

On the other hand are the true technology companies that have learned the above approach isn’t good enough, nor the way forward, because CX is not being seen as the most important single element of your development. It’s these firms that are focused on coding new solutions and have been able to understand how to embed a culture of customer centricity using technology and data that are outperforming their peers.

So when you’re looking for potential partners, it’s vital to assess if organisations you could partner with for technology, culturally embrace customer centricity principles and place CX at the heart – or is it simply used as a tag line? Culture is the key.

Those that do embed CX culture are the businesses that are led by the engine room, not from the boardroom. It’s the individuals that are on the front-line within an organisation that are experiencing the live customer feedback and are working daily to solve problems, who will not only know where to focus the business but will also often come up with the best solutions and are empowered to make decisions.

The Leadership Team should be there to orchestrate the direction, reward bold thinking and be responsible for setting the boundaries – that is how true customer centricity is achieved.

When firms are choosing their business partners of the future it’s vital to assess who has built customer centricity and not just technology, and who is driven by a talented and trusted empowered team, as they will be the ones thinking outside the box to create progressive solutions that work for your customers.

The year of opportunity

2022 will be a big year in the advisory sector for numerous reasons. It will be one of the biggest years for remortgages ever recorded, with almost £40bn worth expiring in January alone, and new FCA regulations on GI pricing practices come into force meaning price walking will be banned.

Such a large volume of expiring mortgages presents opportunity for obvious reason, and when you consider many of these remortgaging customers will be paying over the odds for their current home insurance policy, in the likely situation they have been subject to price walking, it’s easy to see why 2022 could be the year for advisers to truly reclaim their market share once lost to price comparison sites.

The advisory sector itself will become much more competitively positioned on price as a direct result of the new regulations. Not only that, but Advisers are now also able to offer a quicker, easier and more streamlined insurance application than price comparison websites as well being able to more effectively advise on products that add value and those that don’t.

This means there is not only great opportunity in the short term for the scores of customers remortgaging, but advancements in technology in the intermediary space can be used to help secure the long-term futures of advisory firms, too.

Customer adoption of PCWs

PCWs took huge chunks of market share from Advisers very quickly following their inception in the late 1990s and they now dominate the market.

They became symbols of efficiency, and an example of how technology can be used to find the “best” price for insurance. It was simply unheard of that you could get numerous quotes from different businesses by filling out one form. But what was innovative and more efficient then, is now viewed as long and laborious.

In order to meet the underwriting requirements of all of the dozens of insurers who are providing a quote, the questionnaire home owners need to answer involves anything upwards of 50 questions in a longwinded exam for the consumer.

Innovation in the intermediary sector

Innovation has been prevalent in the intermediary space and, as a result, Advisers have the advantage when it comes to being able to get the best price quickly and conveniently from a range of providers.

Through our platform, for example, you can get a quote from a wide-ranging panel of the UK’s leading insurers by answering just three questions (name, date of birth and postcode), with a full application taking less than a minute. A far cry from lengthy exams that consumers are faced with should they opt for PCWs.

The ace cards of convenience and speed are therefore right back with the Adviser and the opportunities that both mortgage cessation and new regulation bring means the intermediary sector has all the tools it needs to be able to reclaim market share as we head into 2022.

Using technology to help future proof your business

In addition to the huge short-term opportunities, we’re presented with, there is also the chance to capitalise on the innovation we have made as a sector to help change the way future generations purchase insurance.

The next generation of first-time buyers are the most tech-savvy of the lot and are very happy to spend their money with disruptors who offer easy-to-use platforms.

To protect against future losses in market share, just as the opportunity to reclaim from PCWs has hit us, intermediary firms must adopt the technology available to them. That means not only offering tech solutions to a more digitally savvy, Gen-Z and late-millennial audience, but tech solutions that deliver greater value.

Now is the time to integrate technology

Advisers already have a huge head start on PCWs on being able to do this as they know how their client is progressing in their mortgage journey. Holding data such as, ‘mortgage offer received’ or ‘exchange date’ indicates the exact timing of when home insurance is needed. This data is gold dust, yet today we estimate that c.675,000 advised mortgage clients still go outside of the intermediary industry to buy their insurance.

The problem with neglecting general insurance and allowing so many potential customers to end up on price comparison websites means advisory firms are essentially feeding other businesses with a lead flow that have an intention to cross sell into more core product areas, such as mortgages and protection, which is a major reason why market share has been lost across the wider space.

Fortunately, when speaking to Principals and seeing how our partners are operating, we know that the tide is turning on this issue.

In 2022, we’ll see more and more firms using integrated technology that help Advisers properly take advantage of the ‘gold dust’ knowledge they own and with it, insurance will seamlessly integrate into mortgage journeys, so the product is offered at exactly the right time.

And so, looking to next year, now is the time to make the forward-thinking choices on the digital tools you’re going to use to truly seize the opportunity that lies ahead. From an insurance perspective, it is no longer time consuming and stressful and can instead exceed the expectations of existing and prospective clients, helping to reclaim market share.

If there was ever a time to discuss home insurance, it’s certainly a good time now.

This is especially given so many of your remortgaging clients will likely have held their existing insurance policies for multiple years and could be paying more than they should be.

More than £183bn of residential mortgages will expire by the end of 2021. As we head into autumn the remortgage and product transfer opportunity is expected to be strong, with the focus switching from an extremely busy purchase market in the first half of the year.

The Financial Conduct Authority’s (FCA) well-documented general insurance pricing practices market study found the home and motor insurance markets are not working well for all consumers. Customers are often penalised for their loyalty and may well need your help and guidance in ensuring they are not caught in the loyalty trap.

Wise up on price walking

The FCA’s study led to new regulations which are due to come in from January 2022. These will ban insurers from artificially discounting new business premiums with the intent to hike prices in subsequent renewals.

The regulator has estimated that the insurance industry gained £1.2bn from six million policy holders through price walking in 2018. It predicts that the ban will save customers £4.2bn during the first 10 years following its introduction.

The role of an adviser to inform and educate about insurance has never been more important and, as this wave of remortgaging clients start to re-engage, there’s a golden opportunity to demonstrate the value of advice, ensure fair value and potentially save your clients money on their existing insurance.

So, what do you need to consider when reviewing you remortgaging customers insurance?

1. Educate your clients to think beyond price

As the name suggests, price comparison sites are largely useful for comparing on price. Although, understandably, price is the dominant factor of any conversation, it’s also vital to weigh up whether a policy is offering good value.

This, in turn, lets you explain how certain policies do or do not meet the client’s needs and steer the conversation away from base price to best value.

2. Introduce general insurance early on

Ask for a copy of your clients existing home insurance schedule as an addition to any other documents you require as part of your remortgage advice process.

3. Explain what price walking means

Show clients how they could be paying more than they should be. The ban on price walking will come into force from January 2022. So, ahead of the rules being implemented, it’s a really important time to discuss with clients who have held insurance policies for multiple years to review their needs.